Adventure Sandbox

It’s been no secret that NBC Universal has not been happy about their current iTunes contract. According to a provision in their contract with Apple, NBC notified Apple last month that they would not be renewing their current contract. In response, Apple decided not to offer the upcoming season of NBC shows to its millions of customers.

You might also remember that Universal Music Group decided not to renew their iTunes contract a few months ago, instead going on a month to month contract. A little more than a month after not renewing their iTunes contract, Universal Music Group decided to give DRM free downloads a try on a number of download services, none of which were named iTunes. Today we got word from the CEO of Vivendi (parent company of UMG and 20% owner of NBC Universal), that “The split between Apple and (music) producers is indecent.” As it turns out, 70% of all UMG revenue goes to Vivendi.

There is definitely a growing displeasure of media companies not happy with Apple and iTunes. Nearly every story about this displeasure revolves around the lack of control over pricing given to the media companies. With the spreading anti-iTunes sentiment, I expect Apple to release some control over media pricing in the next 6-12 months. In nearly every non-regulated business sector, pricing is set by the producer or service provider, not the distributor. We’ll see in the long term if the media companies shoot themselves in the foot or actually increase revenue.

Tags: Apple //